Paper 2: Architecture and Platforms in the Evolution of Infrastructure
Paper 3: Turf Wars and Power Struggles

Section II and III
Sections 2 and 3 of this course dealt with the evolution of
infrastructure and architecture for communication technologies.
The class looked at the development of railroads, telegraphs,
radio, and television broadcasting in both Technologies of
Freedom, and The Gordian Knot. We specifically looked at the
development of the Internet and how various historical,
political, and economic forces shaped it's development and how
these same forces will shape the development of the NII.
I was particularly interested in class room discussions
concerning the role of market demand in the structuring of the
NII. The most recent example, was a brief foray into the
artistic merits of Hollywood. Some had expressed disdain for the
quality and nature of the movies produced by Hollywood. This was
presented as an example of a failure of the medium, in part
because of tight control by a media hegemony. Though I feel
Hollywood often produces material that is inane and offensive, I
would hesitate to require that the government do anything about
it other than make sure there is an environment in which
competition may occur and some form of choice and participation
is afforded to consumers/citizens. However, most people _want_
to see Arnold Swarchzenegar, and it is a bit presumptuous to
assume that these people really need to be watching "quality"
programming of someone else's choosing.
I have encountered this viewpoint before, particularly from a
European film professor, and in the debate in France concerning
whether they should be able to exclude American films. The
reason this argument is applicable and important to this course
is because the demand help shall shape the NII, and those that
can manipulate or interpret demand in their favor shall have
immense power. A simple comparison of possible scenarios is a
country only wired for video on demand, versus a society wired
for independent publication and communication.
In a previous discussion on this topic Mitch Kapor had argued
that market demand is not always an indicator of what people
would eventually find to be valuable. His argument was that
though no large corporations perceived a demand for products like
Lotus, spreadsheets have become a necessity of the modern day
world. Though I do not disagree with this argument, it is
interesting to note that though the market may have not seized
upon the idea as quickly or eagerly as he would have liked, Lotus
eventually became immensely successful. Yet, one can find many
examples in which a superior product is not chosen by a free
market system. In this paper I shall examine this phenemona
within the context of computer and communication technologies.
First, I shall argue why a free market is sub-optimal, then why a
controlled economy is the same. Finally, I shall recommend what
I think is a good balance between the two poles for technology
policy.
Why Market Demand May be Sub-Optimal to Social Welfare?
One difficulty in the thesis that market demand shall drive the
market in the most efficient manner is that even if consumers
express preferences unambiguously, companies may not perceive
those preferences correctly. For instance, the great amount of
hype concerning the NII leads some to feel that it shall meet a
great demand for sophisticated video services and nothing else.
I would argue that this perception is false.
Even if someone could argue with my example above, one cannot
deny that companies expend a great amount of effort in attempting
to measure consumer demand. This is where a second fault may
crop in to my thesis. It is well known--and was very much
discussed at the Internet Economics Workshop--that surveys of
people's preferences are relatively useless if they are not in
the context of the real world. (Comments from David Clark.) For
instance, people may say they are willing to pay 1 cent more per
minute for a higher resolution video image, but until the person
is presented with the new image, and with a monthly bill, their
actions may not reflect their words.
The nature of technology policy further confuses the relationship
between demand and supply. Neuman et al, described the evolution
of our communications infrastructure as a borrowing and
modification of previous transportation models. For instance,
the network of rails used by trains led to a similar web of
telegraph poles. Later, long distance telephone service was
defined in terms common carriage, a concept borrowed from
railroad regulation. In fact:
...the wording of the Communications Act was a transposition
of the 1888 Interstate Commerce Act, with "railroad" replaced
by "telegraph and telephone". (Neuman, et al, p. 37)
Pool agrees:
..the general impulse of American courts was to pretend that
the phone was nothing new and to take precedents from
telegraphy and common carreir law over into the telephone
field... (Pool, p. 101)
Because communication spectrum was considered to be limited and
because the infrastructure required "right of way", communication
was often regulated as a natural monopoly. Rate of return (ROR)
regulation overly monopolies totally skewed the workings of a
competitive market to the point where the difficulty of
regulating AT&T led to its break up, and to the current proposals
for a competitive industry.
Continuing with the discussion of monopolies and hegemonies,
currently there is some "danger" to our society and economy from
the immense power of individuals such as Gates, Malone, Smith,
and Diller. From the readings, I felt a bit frightened that the
future of the NII--and consequently the nation--is dependent on
actions that may be born of swaggering egos rather than reason.
There is another difficulty in relying solely upon perceived
demand as a motivation for NII decision making. Market demand
and shareholder's desires are often based on the short term.
This short sightedness is further exaggerated by extranalities
like the "bandwagon effect" which results in an advantage to the
first mover. If people release an inferior product first, or
promise to (vaporware), that product has an advantage in that
once some people by it, it become a standard with which other
people will wish to interoperate with. (Or the example of the
inefficient and dangerous QWERTY keyboard shows how inefficient
technologies and policies can persist.)
Why Government Centralized Control May be Sub-Optimal to Social
Welfare?
I shall deal with this question quickly in hopes that most
readers would be sympathetic to my answer. First, I would argue
that controlled economies seemed to have faired worse than "free"
economies throughout the world. Second, one could argue the
government is nothing more than a business itself, albeit a large
one. Governments have a natural tendency to want more revenue,
and the decision making within a government will have many of the
problems discussed previously, if not more and to a greater
extent.
What is the Role of Government and the Market towards Social
Welfare?
The function of the government is to do beneficial things that no
other entity could. No other entity could enforce uniform civil
rights throughout 50 states, no other entity could provide a
stable currency and set of uniform regulations providing for a
competitive market. Of course, the government may also screw
things up as no other entity could.
Hence, where the market fails, the government should act to
mitigate the failure. If most people pay millions to see inane
movies, it is not be government's place to prevent it. Instead,
it should provide an environment in which, if people wanted, they
could have the oppurtunity to see good movies. Or, it may
provide a helping hand through PBS to cable babies, so as to
educate and enlighten. PBS provides an immense amount of
education materials to schools. Furthermore, if it were cut,
affluent and large populations in areas like New England (Boston)
or the Mid Atlantic (Baltimore/DC) would continue to have such
programs, but poorer regions would not. It is providing benefits
that far exceeds the costs and in a unique manner that private
industry could not.
Returning to technology, the development of standards in the
digital community is an example of good government. The IETF and
ISO act in their own ways to understand the present, and look
towards the future so as to provide long term planning, and
common sense in the short term. The Computer Systems Policy
Project spoke of interoperability, scalability, extensibility,
accessibility, etc. as goals for development. This is not an
attempt to satisfy immediate short term goals of the producer's
or consumer's, but a process in which the social welfare of all
will hopefully be enlarged through long term goals, and current
real world know how. It is important to realize that the
standards process is not immune from many of the problems
discussed earlier. It can provide to be a powerful weapon of
monopoly and abuse as seen in the histories of AT&T and IBM. A
goal is to keep the standards process as open and flexible and
possible, and the standards themselves should be non-proprietary
and interoperable. "Perspectives on the National Information
Infrastructure: Ensuring Interoperability" provided some points
reflecting my opinions on both standards and government in the
context of developing architecture. (Except I think the
government should play a stronger role in standards development
in advanced research projects than they seem to advise.)
o Open Interfaces are Essential
o Industry-Led Standards are Crucial
o Government Has a Role in Regulated Franchised Markets
o Interoperability Fosters Competition
o Minimize Government Intervention
o Government Must Promote Competition
I hope I have explained my views concerning the importance of
market demand in the digital realm, and how it could effect the
architecture and platform for our future. Furthermore, I have
explained my view of the proper role of government. Both the
market (driven by demand, greed, egos, and extranalities) and the
government (driven by politics, greed, egos, and momentum) may be
able to complement each other's strengths and mitigate each
other's weaknesses so as to provide for the best solution
possible.
References:
Pool, Ithiel de Sola. 1993. Technologies of Freedom. Cambridge
MA: Harvard University Press.
Neuman, W. Russell, Lee McKnight and Richard Jay Solomon. 1995.
The Gordian Knot: Political Gridlock on the Information
Highway. Cambridge: MIT Press.
CSPP. 1994. "Perspectives on the National Information
Infrastructure: Ensuring Interoperability." Computer Systems
Policy Project. (February 1994).
"An Architectural Framework for the Information Infrastructure."
Cross-Industry Working Team. (September 1994).
Kline, David. 1994. "Infobahn Warrior." Wired. (July 1994).
Kline, David. 1995. "Align And Conquer." Wired. (February 1995).
Schwartz, Evan. 1995. "Ray Smith: The I-Way, My Way." Wired.
(February 1995).
Auletta, Ken. 1993. Barry Diller's Search for the Future. The New
Yorker (February 22, 1993).